                                 CODE OF VIRGINIA

PAYMENT OF LOCAL TAXES ON BEHALF OF TAXPAYER BY THIRD PARTY; TAX PAYMENT
AGREEMENTS (§ 58.1-3018)

A. For the purposes of this section, &#8220;third-party tax payment
agreement&#8221; means any agreement whereby a third party contracts with a
taxpayer to pay to a county, city or town on behalf of that taxpayer the local
taxes, charges, fees or other obligations due and owing to the county, city or
town. Such agreement may have as its subject current taxes, charges, fees and
obligations, delinquent taxes, penalties and interest, or any combination of the
foregoing.

B. The treasurer of any county, city or town may enter into agreements
authorizing third parties to offer to taxpayers within such locality third-party
tax payment agreements, provided that such agreements meet the following
requirements:

   1. Every third-party tax payment agreement shall be in writing, in a form
   approved by the treasurer of the locality, and shall provide for the payment
   of the taxes which are the subject of such agreement by the third party
   directly to the treasurer of the county, city or town within ten days of the
   acceptance of a duly executed agreement by the third party.

   2. Third-party tax payment agreements shall provide for the reimbursement of
   the third party by the taxpayer on whose behalf taxes were paid in
   installments over a period not to exceed ninety-six months, and may provide
   for interest, exclusive of any origination fee, at an annual rate approved by
   the treasurer which shall not exceed sixteen percent. Such agreements may
   provide for the payment by the taxpayer of an origination fee at a rate
   approved by the treasurer which shall not exceed ten percent of the amount
   paid by the third party. No interest, excluding any origination fee paid by
   the taxpayer, shall accrue during the six-month period commencing on the date
   of the payment. This subdivision shall not be construed to permit the
   treasurer to authorize a third party to make a &#8220;mortgage loan&#8221; as
   that term is defined in &#xA7; 6.2-1600.

   3. No fee may be charged to or collected from the treasurer or the locality
   with respect to any third-party tax payment agreement.

   4. The third party shall provide to the treasurer monthly status reports
   regarding third-party tax payment agreements entered into by taxpayers of the
   locality. Such reports shall include, at a minimum, a listing of all active
   accounts, and with respect to each account, total charges, total taxpayer
   payments, total amounts paid to the treasurer, and total amounts subject to
   recourse. A summary of the monthly report, deleting any information that would
   identify any taxpayer and any other confidential taxpayer information, shall
   be retained as a public record in the treasurer&#8217;s office.

C. In the event that a taxpayer who is a party to a third-party tax payment
agreement fails in his obligations arising under such agreement to reimburse the
third party:

   1. The third party shall be entitled to receive from the treasurer a
   reimbursement payment equal to all taxes paid on behalf of such taxpayer
   pursuant to the tax payment agreement, less all payments received by the third
   party from the taxpayer, exclusive of interest and fees charged by the third
   party to the taxpayer pursuant to the agreement. No payment may be requested
   pursuant to this subsection unless the third party has demonstrated to the
   satisfaction of the treasurer that good-faith efforts to collect the
   obligations arising under the tax payment agreement have been made and that,
   notwithstanding these efforts, the taxpayer is more than thirty days
   delinquent in his obligations arising under the agreement.

   2. Any treasurer who reimburses a third party pursuant to this subsection
   shall reinstate the amount of such reimbursement upon the appropriate tax
   rolls of the locality as delinquent taxes or current taxes, as the case may
   be, and shall send the taxpayer written notice of such action by first-class
   mail to the taxpayer&#8217;s last known address within five business days of
   such reinstatement.

   3. If the taxpayer fails to pay in full any sum reinstated pursuant to this
   section by the ordinary due date of the tax, the treasurer may apply penalties
   and interest in accordance with general law from the due date of the tax.

   4. Any right of the third party to payment arising under a third-party tax
   payment agreement shall terminate upon the receipt by the third party of a
   reimbursement payment from the treasurer in accordance with the terms of this
   subsection.

D. With respect to each third-party tax payment agreement which has as its
subject, in whole or in part, real property taxes, the third party shall cause
to be recorded among the land records of the circuit court in each locality
within which the real property is situated a copy of the applicable tax payment
agreement. Such agreement shall be indexed by the clerk under the name of the
taxpayer or taxpayers as grantor and the name of the third party as grantee.
Upon the satisfaction of all obligations arising under a tax payment agreement
so recorded, the third party, within ninety days of satisfaction, shall cause to
be recorded a certificate of release, setting forth the names of the taxpayer
and the third party, the date of the third-party tax payment agreement, and the
book and page at which the agreement is recorded. Any such certificate of
release shall be indexed by the clerk under the name of the third party as
grantor and the taxpayer as grantee. The clerk may charge a fee not to exceed
thirteen dollars for the recordation of any tax payment agreement or certificate
of release.

E. Upon the payment of any tax by a third party pursuant to a tax payment
agreement, the applicable period of limitation for the enforcement of each tax
which is the subject of the agreement shall be tolled during any period in which
outstanding obligations remain unsatisfied pursuant to the agreement.

HISTORY: 1996, c. 896; 1997, cc. 180, 846; 2015, c. 257.